Opinion
01 Civ; 8375 (HB)
June 12, 2002
OPINION ORDER
Plaintiff brought this admiralty action to recover for damage to or loss of various cargoes transported pursuant to nineteen separate bills of lading. Defendant Senator Lines GmbH ("Senator Lines") and in rem defendant M/V Cho Yang Success ("Cho Yang") (collectively, the "defendants") each move under Fed.R.Civ.P. 12(b) to dismiss the claims brought under twelve bills of lading that are known to have foreign forum selection clauses. Both motions are considered here. For the following reasons, the defendants' motions are GRANTED.
The plaintiffs have yet to produce in their entirety the remaining seven bills of lading, which plaintiffs are apparently still attempting to locate.
I. BACKGROUND
On September 6, 2001, the plaintiffs filed a complaint containing an in rem claim against the Cho Yang and in personam claims against the defendant shipowners seeking damages for alleged loss and/or damages to various cargoes transported in September 2000. Pursuant to Supplemental Admiralty Rule C of the Federal Rules of Civil Procedure, a claimant in maritime law may seize and arrest a vessel by bringing an action against the vessel itself in rem.
Here, however, rather than arrest the Cho Yang, the plaintiffs accepted a letter of undertaking issued by the vessel's underwriters to allow the ship to continue its business during the pendency of this lawsuit. An amended complaint was filed on November 13, 2001.
At issue are twelve bills of lading that the plaintiffs have thus far produced in their entirety issued by either Cho Yang or Senator Lines. The defendants reserve the right to challenge the remaining seven bills of lading that the plaintiffs have yet to locate in their entirety, and I do not consider those outstanding bills here. of the twelve produced, there are four bills of lading issued by Cho Yang that contain a Korean forum selection clause that states:
The contract evidenced by or contained in this Bill of Lading is governed by the law of Korea and any claim or dispute arising hereunder or in connection herewith shall be determined by the courts of Seoul and no other courts.
The other eight bills of lading issued by Senator Lines contain a German forum selection clause that similarly mandates:
Any dispute arising under and in connection with this Bill of Lading shall be governed by German Law and determined by the courts of Bremen.
The defendants seek to enforce the above foreign forum selection clauses and dismiss those claims brought thereunder.
II. DISCUSSION
A. Motion to Dismiss
A claim will be dismissed pursuant to Rule 12(b)(6) when "it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." See Tarshis v. Riese Organization, 211 F.3d 30, 35 (2d Cir. 2000). Additionally, the court is required to accept as true all of the facts alleged in the complaint and draw all reasonable inferences in the plaintiffs favor. See Madonna v. United States, 878 F.2d 62, 65 (2d Cir. 1989).
A forum selection clause is presumptively valid "unless the party resisting the effect of the clause demonstrates that enforcement is . . . unreasonable under the circumstances." Ferraro Foods, Inc. v. M/V Izzet Incekara, 2001 A.M.C. 2940, 2942 (S.D.N.Y. Aug., 20, 2001) (Sweet, J.) (citing M/S Bremen v. Zapata Off-Shore Co., 407 U.S. 1, 15 (1972)). The exception is narrowly construed in that a forum selection clause is deemed unreasonable if the plaintiff can show that (1) it was the result of fraud or overreaching, (2) it would effectively deprive the plaintiff of its day in court, (3) there is fundamental unfairness of the chosen law that may deprive the plaintiff of a remedy, or (4) the clause contravenes a strong public policy of the forum state. Roby v. Corporation of Lloyd's, 996 F.2d 1353, 1363 (2d Cir. 1993) (citing M/S Bremen).
Additionally, district courts have enforced forum selection clauses similar to those at issue here. See, e.g., Asoma Corp. v. M/V Southgate, 1999 WL 1115190 (S.D.N.Y. Dec. 7, 1999) (Haight, J.) (enforcing Korean forum selection clause); Reed Barton Corp. v. M/V Tokia Express, 1999 WL 92608 (S.D.N.Y. Feb. 22, 1299) (Preska, J.) (enforcing German forum selection clause); Hyundai Corp. U.S.A., Inc. v. M/V Long Jiang, 1998 WL 13835 (S.D.N.Y. Jan. 15, 1998) (Patterson, J.) (enforcing Korean forum selection clause).
The plaintiffs fail to show how enforcement of the forum selection clauses would be anything other than reasonable and consistent with the parties' intentions, nor do they establish any of the four Roby exceptions.
The fact that several of the bills of lading are subject to the Carriage of Goods By Sea Act ("COGSA") does not save the plaintiffs. As COGSA applies to "all contracts for carriage of goods by sea to or from the ports of the United States," 46 U.S.C. § 1312, the plaintiffs assert that those forum selection clauses subject to COGSA are invalid under 46 U.S.C. § 1303(8) ("[a]ny clause. m a contract of carriage relieving the carrier or the ship from liability . . . shall be null and void."). While section 1303(b) of COGSA prohibits a bill of lading from relieving a carrier of its obligations or lessening a carrier's legal duties specified by the Act, Reed Barton Corp., 1999 WL 92608, at *2, the Supreme Court extended the presumption of validity to forum selection clauses in bills of lading governed by COGSA unless the "substantive law to be applied [by the chosen forum] would reduce the carrier's obligations to the cargo on or below what COGSA guarantees." Vitmar Seguros v Reaseguros, S.A. v. M/V Sky Reefer, 515 U.S. 528, 539 (1995).
The plaintiffs have asserted in only a conclusory fashion that their remedial opportunities will be limited below the COGSA minimums because German and Korean law do not recognize in rem actions. The plaintiffs' mere speculation, however, is insufficient to bar enforcement of the forum selection clauses. See Reed Barton, 1999 WL 92608, at *2; see also Silgan Plastics Corp. v. M/V Nedlloyd Holland, 1998 WL 193079, at *3 (S.D.N.Y. April 22, 1998) (Martin, J.) (stating that mere skepticism over the ability of a foreign court to apply rules of COGSA must give way to contemporary principles of international comity and commercial practice). The bills of lading evidence no indication that the parties intended to exempt in rem actions from the forum selection clauses, and the plaintiffs have failed to show why I should find otherwise or against the tide of the majority of case law. See, e.g., Salim Oleochemicals, Inc. V. M/V Sbropshire, 177 F. Supp.2d 159, 161 (S.D.N.Y. 2001) (Buchwald, J.) ("Courts within this district and without have repeatedly compelled foreign litigation . . . over plaintiffs' objections that the foreign forums do not recognize in rem claims."); Asoma Corp., 1999 WL 1115190, at *2 ("Most federal courts have interpreted Sky Reefer as extending the general presumption of enforceability to foreign forum selection clauses in COGSA governed bills of lading."); Reed Barton, 1999 WL 92608, at *2 (enforcing German, forum selection clause and finding that it includes in rem actions).
Finally, the plaintiffs argue that the multi-party nature of this litigation warrants a finding that the forum selection clauses are unreasonable. I disagree. The plaintiffs have failed to show that the possibility of parallel litigation involving multiple defendants was anything but foreseeable when the parties negotiated the bills of lading. Further, there are significant public policy reasons in favor of enforcement. See. e.g., Sweet, Sound Around Electronics v. M/V Royal Container, F. Supp.2d 661, 663 (S.D.N.Y. 1999) (Rakoff, J.) (enforcing German forum selection clause and noting that refusal to do so on the basis of multiple proceedings or defendants "would undermine whatever measure of certainty such clauses bring to the international shipping transactions in which they are commonly employed.").
III. CONCLUSION
For the above reasons, the defendants' motions to enforce the Korean and German forum selection clauses is GRANTED and the claims brought pursuant to the twelve bills of lading known to contain those clauses are dismissed. The non-jury trial of the claims brought under the remaining seven bills of lading, if they are ever located and assuming they do not contain the above forum selection clauses, is scheduled for July 29, 2002. The pretrial order and any in limine motions, fully briefed, including objections to exhibits or proposed deposition transcript excerpts, are due no later than July 22, 2002. Should the outstanding bills of lading not be found and no trial can therefore proceed, the matter will be dismissed on July 29, 2002, and the clerk instructed to remove the matter from my docket.